Wednesday, October 12, 2016
Report: NastyGal Facing Cram Down Round, Seeking Buyer
Los Angeles-based fashion website NastyGal is apparently in the midst of a "cram down" round--a round where the current shareholders in a company essentially reset the equity structure of a company that usually forces non-participating investors to lose most, if not all of their stake in the company. The report today, from PandoDaily, follows an earlier report from the fashion industry which said that NastyGal was seeking a buyer for the company. NastyGal--founded by Sophia Amorusa--had been facing some major headwinds over the last few years, which had resulted in Amorusa resigning as CEO and layoffs at the company. On the upside, the new funding round--even with its "cram down" provisions--would provide the company with much needed financing, as much as $40M, according to the report.